The long-term goal of this work is to understand the regulation of transcription initiation and how the activity of transcriptional regulators is influenced by signal transduction pathways. The gene to be used in these studies is the yeast gene, PHO5, which encodes a secreted acid phosphatase whose transcription is tightly repressed in high concentrations of phosphate and induced approximately 1000-fold in response to phosphate starvation. Upon induction, the PHO5 promoter undergoes a dramatic alteration in chromatin structure that results in the disruption of four positioned nucleosomes. Several of the molecules involved in PHO5 regulation have been identified by genetic analysis and belong to highly conserved families found in higher eukaryotes. These include the homeodomain protein PHO2, the basic-helix-loop-helix protein PHO4, and the cyclin-cdk (cyclin-dependent kinase) complex consisting of PHO80 and PHO85. The three aims of this proposal are to: (1) Determine the mechanism of action of the positive transcriptional regulators, PHO2 and PHO4, and determine how their activity is controlled. (2) Characterize the activity of the negative regulators PHO80 and PHO85, which make up a protein kinase, and determine how its activity is regulated. (3) Investigate the requirements for the chromatin transition at the PHO5 promoter. An understanding of how these molecules function and cooperate to regulate PHO5 will reveal fundamental connections between signal transduction pathways and transcriptional control and will also provide insight into these connections in higher eukaryotes. The PHO80-PHO85 complex represents a unique opportunity to study the function of a cyclin-cyclin dependent kinase complex: in this case, a biologically relevant substrate (PHO4) has been identified, and the effect of phosphorylation is known and can be reconstituted m vitro. Finally, investigation of the transcriptional control of PHO5 may lead to an understanding of the role of chromatin structure in gene regulation.